World Future Energy Summit: Day 1 Highlights

After an introduction from the Chair, Richard Banks, CEO of R M Banks & Co, Dr Sultan Ahmed Al Jaber, CEO of Masdar began the summit in earnest, pointing out that renewable energy is still relevant, despite the recent financial crisis. He also highlighted the massive growth that the sector has seen since 2004, with total investments rising four-fold to US$155bn. However, given that the world’s population is expected to grow to 9bn by 2050 and its energy use projected to double over the same period, Dr Al Jahr made it clear that “we must urgently progress green energy”.

Throughout the first day of the summit, the recent Copenhagen meeting was never far from discussion. Although described by the vast majority as a disappointment, some like the UK’s Minister for Energy and Climate Change, Ed Miliband took pains to paint it in a positive light, highlighting the number of countries that had signed up to the (non-legally binding) agreement and pointing out that given the work-load and the time taken up by procedure, it was always going to be extremely difficult to deliver to expectations. He argued that developing nations needed to realise that “they have nothing to fear” and that the message should be one of prosperity. Mr Miliband also argued that any future global agreement would be successful if the world’s CO₂ emissions peaked in 2020 and said that he was in favour of the EU extending its CO₂ reduction target to 30 per cent on 1990 levels by 2020. When queried as to whether or not a 450ppm target made sense given that it has only a 50 per cent chance of limiting global warming to two degrees Celsius by IFandP, Mr Miliband said that “I agree we need to be ambitious” and that if the current plans come to fruition, then we should be close to the target of limiting global warming to two degrees Celsius. Mohamed Nasheed, President of the Maldives, also said that the Copenhagen summit had some positive outcomes, such as the US$100bn fund to be established with the goal of helping developing countries cope with the impacts of climate change. But at the same time, he warned that in its current form, it will not stop catastrophic climate change, which would see the Maldives under water.

Turkey’s prime minister, Mr Recep Tayyip Erdoğan was keen to highlight his country’s goals in the field of renewables, including a target to increase its installed wind power capacity to 20GW by the next decade. Interesting, he also took pains to illustrate Turkey’s growing contribution towards energy security in the form of the Baku–Tbilisi and Samsun-Ceyhan oil pipelines, the Turkey-Greece natural gas interconnector and the Nabucco project. Mr Erdoğan also envisaged a natural gas pipeline between Qatar and Turkey, offering “remarkable opportunities for the Gulf region.”

Although the debate, by-and-large, stuck to the script, there were occasional moments of tension and plain speaking. A prime example of the latter was a comment from Abdullah Bin Hamad Al-Attiyah, Qatar’s Minister of Energy and Industry. He said that one of the reasons why Copenhagen failed was that it tried to turn fossil fuel producing nations into scapegoats, which in his mind was particularly rich given that several nations had been scathing of fossil fuels, until such resources had been discovered in their territory. When the chair asked Ambassador Wang Xue Xian, how the divide between China and the US could be bridged given the former’s rising power and stated his belief “that success isn’t possible without them”, it sounded like a coded request for an explanation of China’s performance at Copenhagen. The ambassador responded by robustly defending China’s record, pointing out its commitment to increase energy efficiency by four per cent a year and saying that “as far as China is concerned, we know our responsibility and we are doing everything we can to do it.”

One of the more interesting questions posed to several energy ministers was what they thought both their country’s and the global energy mix would be like in 2050. Hasan Younes, Egypt’s Minister of Electricity and Energy painted a broad vision, suggesting that by that point, nuclear fusion and hydrogen would both be playing a significant role. Meanwhile, South Korea’s Young Hak Kim commented that he expected fossil fuels to be “depleted” by then, with the result that renewable energy would account for 50 per cent of electricity production by 2050, although his country was planning for a higher figure of 75 per cent. He also said that he expected the price of electricity to be high, creating a wide gap in living standards.

The impact of government policy and regulation on the renewable sector was the subject of considerable commentary, with Deutsche Bank’s Tom Curtis explaining that investors need TLC: transparency, longevity and certainity. Both he and Katrina Landis, Group Vice President of BP Alternative Energy, made much of Germany’s approach to regulation, including its use of “step-down” feed-in-tarriffs to promote innovation and to prevent emergent green industries from becoming permanently dependent on subsidies. Meanwhile, Italy and Greece were held up as examples of where inconsistent regulation had scared off investors.

Wolfgang Dehen, CEO of Siemens AG Energy Sector, pointed to the large number of positive developments made in recent months, such as the launch of the Desertec initiative, the goal of building 32GW of wind power capacity off the UK coast, tidal plants in Korea, the launch of the International Renewable Energy Agency, the rise of the smart grid along with a number of CCS pilot plants and said that: “we are seeing an accelerated transformation of the energy system”.

Mete Maltepe of GE Energy commented that his company was expecting energy demand in the US and Europe to increase by 30 per cent over the next 10 years, with Asia seeing double this rate of growth. He also said that wind was GE’s fastest growing segment, recording 20 per cent growth per annum. When asked by IFandP, as to what would be more politically difficult between introducing a wind-enabling smart grid across the whole of US or Europe, Mr Maltepe said that it would probably be the US. This answer does serve to highlight the fractious nature of US politics in general, with the country’s polarised landscape and its myriad checks and balances making it difficult to introduce sweeping changes, no matter how potentially beneficial.

About WFES

The World Future Energy Summit, now in its third year, is held from 18-21 January 2010, hosted by MASDAR, at the Abu Dhabi National Exhibition Centre under the patronage of HH General Sheikh Mohammed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces. World leaders, policy makers, experts and investors from 100 countries will meet in Abu Dhabi to identify real solutions for today’s climate change and energy challenges. Over 600 exhibitors from 50 countries will be exhibiting at the World Future Energy and Environment Exhibition on a total space of 40,000m² offering an unrivalled business and networking opportunities to over 20,000 attendees expected to visit the summit and the exhibition. Deutsche Bank Climate Change Advisors is the principal sponsor of WFES 2010. Emirates Aluminium is Associate Sponsor, and additional sponsors include BP Alternative Energy, Standard Chartered, Siemens, Schneider Electric, Exxon Mobil, ABB, Abu Dhabi Water and Electricity Authority, Oxy, the Abu Dhabi Department of Municipality Affairs and Terna. For more information on the programme or to register, visit www.worldfutureenergysummit.com